6 - The FCA Handbook

Question 1

The Threshold Conditions

Answer 1

(COND) the minimum conditions that a firm must satisfy at all times if the firm is to retain its Part 4A permission to conduct investment business in the UK

Question 2

COND 2.2

Answer 2

location of offices

Question 3

COND 2.3

Answer 3

effective supervision (by the FCA, i.e. no close links that could effect)

Question 4

COND 2.4

Answer 4

appropriate resources

Question 5

COND 2.5

Answer 5

suitability - fit and proper

Question 6

COND 2.7

Answer 6

business model

Question 7

SYSC

Answer 7

Senior Management Arrangements, Systems and Controls

Question 8

SYSC 2

Answer 8

senior management arrangements - individuals should be personally responsible for the senior management functions in the firm - with a record showing this

Question 9

SYSC 3

Answer 9

systems and controls (that are appropriate to their business)

Question 10

SYSC 6

Answer 10

compliance, internal audit & financial crime

Question 11

SYSC 7

Answer 11

risk controls

Question 12

SYSC 18

Answer 12

whistle blowing - awareness of how and where this can be done is a requirement of the Public Interest Disclosure Act (1998)

Question 13

SYSC 19

Answer 13

remuneration code - firms must establish, implement and maintain remuneration policies, procedures and practices that are consistent with an promote effective risk management
- there are 12 remuneration principles

Question 14

FINMAR

Answer 14

Financial Stability and Market Confidence

Question 15

FINMAR 2

Answer 15

rules and guidance in relation to short selling - supporting the FCA’s objectives to protect consumers and enhance financial integrity

Question 16

BIPRU

Answer 16

the prudential sourcebook for Banks, Building Societies and Investment firms
- deals with firms subject to the Capital Requirements Directive III (CRD III) and covers specific elements relating to the capital resources calculations

Question 17

General Prohibition (s.19 FSMA)

Answer 17

criminal offence to carry out regulated activities unless the person is authorised or exempt

Question 18

what is required for a firm to qualify for exempt status?

Answer 18

must be contracted to an authorised person responsible for their activities

Question 19

aim of the introduction of stakeholder products?

Answer 19

to improve access to financial services for those on low incomes

Question 20

what is the maximum fine for breaching DPA (2018)?

Answer 20

£17m or 4% of global turn over

DPA implements GDPR in the UK